BI: MSME Loans Must Be Measured by Quality, Not Just Quantity

Bank Indonesia (BI) Senior Deputy Governor Destry Damayanti has reminded that the growth of credit to the micro, small, and medium enterprise (MSME) segment must be measured not only by its quantity but also by the quality of its distribution to genuinely boost the productive sector and expand financing access. “Whether the credit goes to productive sectors, whether small sectors also get growth or access from banks that is relatively equal to large companies,” she said at the Economic Briefing 2026 event in Jakarta on Friday. Based on Financial Services Authority (OJK) data, MSME credit grew 0.60 percent year-on-year (yoy) in May 2026. This growth was contributed by micro and medium enterprise credit, which grew 0.64 percent yoy and 1.84 percent yoy respectively, although small business credit contracted by 0.24 percent yoy. Although MSME credit performance has improved compared to last year, which recorded negative growth, Damayanti assessed that increasing financing access for MSMEs remains a shared task. She believes that MSME growth accompanied by quality financing will be a driver for creating quality and inclusive economic growth. To support this, BI has issued various incentives through macroprudential policy, including the Macroprudential Liquidity Incentive (KLM) policy, to encourage banks to channel financing to strategic sectors, including MSMEs. Banks that meet the requirements can even receive incentives in the form of a reduction in the reserve requirement (GWM), giving them greater liquidity space to disburse credit. Beyond financing, BI is also expanding financial inclusion through the development of digital payment systems, such as QRIS, to make transactions easier, cheaper, faster, and more inclusive. Damayanti revealed that the number of QRIS users has now reached 66 million, with 45 million merchants, around 90 percent of whom are MSME players. “So, our goal is to develop an inclusive payment system. Alhamdulillah, the results are starting to show. But we must continue to improve this going forward,” she said. She emphasised that strengthening MSMEs is very important considering the sector is the backbone of the national economy. Indonesia has around 64 million MSMEs that contribute about 60 percent to the gross domestic product (GDP) and absorb around 97 percent of the workforce. In addition, around 60 percent of MSME players are women. Therefore, Damayanti asserted that paying attention to MSMEs means not only encouraging inclusive economic growth but also strengthening the resilience of the national economy. “A country will have strong resilience if the majority source of its growth is given attention,” she said. She also stressed that MSMEs are not just contributors to economic growth, but are the lifeblood of the Indonesian economy. For this reason, strengthening this sector must be a shared concern of BI, the OJK, the government, and other relevant stakeholders. On the other hand, Damayanti acknowledged that MSMEs still face various challenges, ranging from financing access, management capacity, and digital adaptation, to expanding market access. Regarding market access, she assessed that most MSMEs still face limitations in expanding their marketing reach, even to meet domestic market needs, let alone penetrate export markets. “Currently, out of 64 million MSMEs, only about 15 percent are able to export, and even then only for certain types of products,” she said. She cited the coffee industry as an example of an MSME sector that has been relatively successful in expanding market access, as Indonesian coffee is widely recognised in the international market for its diverse flavours. “However, the number of certified baristas and coffee business players who meet international standards is still limited. Whereas, if we want to enter the global market, product quality and human resources must also be continuously improved,” she said.